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Report: Corporate-Sponsored Research Just as Accessible as Government Research

• By Dian Schaffhauser
• 04/01/14

A new study has found that industry-sponsored research is no more likely than federally sponsored research to be bound by exclusive licensing and that it tends to produce more patents and licenses.

The investigation examines the long-held assumptions that corporate support somehow skews research toward inventions that are "less accessible and less useful" or tilts it to corporate benefit compared to research funded by the government or non-profit organizations. Research led by a University of California, Berkeley professor offers "empirical evidence to the contrary."

The findings in "Technology Transfer: Industry-Funded Academic Inventions Boost Innovation," published on Nature.com, are based on the results of an analysis of 12,516 inventions and related licenses at nine University of California (UC) campuses and three associated national laboratories. The inventions were released between 1990 and 2005, and licensing activity was scrutinized through 2010. Of the inventions, nearly 1,500 were supported at least partly by private industry.

During the years from 1990 to 2010 the UC system accounted for as much as nine percent of the total expenditure made in academic research in the United States. Collectively, the system obtained more patents than any other American institution — often twice as many as the second largest producer, MIT.

Industry-funded inventions actually yielded patents and licenses more frequently than the federally sponsored ones — no matter what the technical field. These inventions were also more highly cited in subsequent patent applications — known as "forward citations." Forward citations are a common gauge to measure the importance and quality of a patent. "Each corporate-sponsored invention generated, on average, 12.8 forward citations...compared with 5.6 for federally sponsored inventions," the researchers wrote. "This runs counter to the expectation that corporate-sponsored inventions have narrow applications, and so create more private benefits but few benefits for others."

But do corporations tie up the discoveries from research they've sponsored in a way that's restrictive to others that might benefit? Apparently not. "First, the overall percentage of corporate-sponsored inventions licensed exclusively (74 percent) is not higher than for those with solely public funding (76 percent)," the report stated. "Second, half of the exclusive licenses for corporate-sponsored inventions seem to be to third parties."

"We didn't expect these results," said Brian Wright, a professor of agricultural and resource economics at UC Berkeley. "We thought companies would be interested in applied research that was closer to being products, and thus more likely to be licensed exclusively and less cited than federally funded counterparts, but that did not turn out to be the case."

The authors noted that they didn't necessarily identify every third party licensee affiliated with the original corporate sponsor, but they added that this gap doesn't change the finding that publicly funded licenses are more likely to be exclusive than corporate-funded ones.

There are several reasons why companies may invest in university research programs beyond the assumed idea of gaining exclusive access to the findings, the researchers said. For one, firms may be funding exploratory research "to investigate areas outside their core strengths" in the hope of striking it rich. They may expect to be able to capitalize on the inventions licensed by others in the aftermath of a discovery. And there may be recruiting motives; they may simply "value sustained relationships with leading scientists" and the opportunities they have to identify talented future hires.

However, Wright and his co-authors emphasized, oversight is still essential in industry-funded research. "The tobacco, food, pharmaceutical and other industries have been shown to manipulate research questions and public discourse for their own benefit and even to suppress unfavorable research," they noted.

Another caveat by the researchers: Their analysis only covered one university system, which may be atypical. Because of UC's strong reputation for basic research, its tech transfer offices tend to have more negotiating power when drawing up contracts.

That said, the authors stated, the findings should allay institutional concerns "that corporate sponsorship turns leading universities into corporate vassals."

The $431,000 research project was sponsored by the National Science Foundation's Directorate for Social, Behavioral and Economic Sciences.